By Ron Cohen

28 September 2016

Recently, TLFC Principal, Ron Cohen brought to you the blog, Choosing the Right Structure to Purchase your Property | Part I. Following on from that, Ron discusses the importance of Purchaser Nominations.

It is preferable to identify the appropriate purchasing entity before a Contract of Sale is entered. However, in many instances, a property is purchased by a Purchaser “and/or nominee”. In such cases, the original Purchaser has the right to nominate an alternative or additional Purchaser to complete the Contract and receive a transfer of the property after settlement.

A simple nomination of another Purchaser will not trigger additional stamp duty, even if the nominee is not in any way related to the original Purchaser.

However, if there is any land development occurring to the property being purchased prior to nomination, or if additional consideration is paid in order for the nominated party to obtain a right to receive a transfer of the land, the State Revenue Office may assess the nomination as a separate transaction which will attract additional stamp duty.

Land development is defined by the SRO to include the following:

  • Preparing a Plan of Subdivision or taking steps to have a Plan registered;
  • Applying for or obtaining a Planning Permit;
  • Applying for or obtaining a Building Permit or doing anything for which a Building
  • Permit is required; and
  • Developing or changing the land in any other way that would lead to the enhancement of the property’s value.

For and “Off the Plan” transaction, “land development” is likely to occur between the time that the Contract is entered into and the nomination occurs however the land development will be undertaken by the Vendor and the purchase price should reflect and include the land development, (so the consideration stated in the Contract includes consideration for land development). In such a scenario, additional stamp duty is unlikely to be assessed.

Please Note: There are additional stamp duty considerations if a foreign purchaser is nominated, and extra stamp duty may be applicable in such circumstances.

Related Articles

View All
Property & Development / Commercial Contracts & Agreements / Small to Medium Enterprises

COVID-19 Clauses in Contracts of Sale

The uncertainty and instability of the COVID-19 pandemic continues, as Melbourne endures lockdown 60 and other parts of...
Read More
Property & Development

It’s Groundhog Day: COVID-19 and the new CTRS legislation

It’s a bit like Groundhog Day down here in Victoria: another day, another lockdown Another year, another Commercial...
Read More
Leasing & Lease Disputes / Property & Development / Real Estate Agents

COVID-19 and the new Commercial Tenancy Relief Scheme

A global pandemic, an economy forced into hibernation, and repeated, extended, and somewhat unpredictable lockdowns…...
Read More
Property & Development

TLFC Law Property Team: Finalist in the Lawyers Weekly Australian Law Awards 2021

Tisher Liner FC Law is proud to announce that once again our Property Law Team has been shortlisted as a finalist in...
Read More
Property & Development

Further announcements concerning the Victorian budget for 2021-2022. What are they?

The State Government has now released further announcements concerning the Victorian budget for 2021-2022 in...
Read More
Property & Development

2021/2022 Victorian budget, overview on how the changes to taxes will affect the property market

Land Tax Increases to land tax will be raised for properties worth more than $18 million from 1 January 2022 Land tax...
Read More
Property & Development / Real Estate Agents

Changes to the Residential Tenancies Act 1997 (Vic). What do the changes mean for real estate agents, landlords and tenants?

The amendments come into effect 29 March 2021 and are intended to make renting residential property fairer and safer in...
Read More
Property & Development / Leasing & Lease Disputes / Owners Corporations & Strata

Head leases and the Retail Leases Act 2003

In the recent case of Izett St Pty Ltd v Applgold Pty Ltd (Building and Property) [2021] VCAT 174 (3 March 2021, Senior...
Read More
Property & Development

Due Diligence – Interview with Ron Cohen

Principal, Ron Cohen was recently interviewed to discuss the reasons why it is important to have a good property...
Read More
Franchising & Licensing / Leasing & Lease Disputes / Property & Development

Amendments to the Commercial Tenancy Relief Scheme

In this blog, we have referred to the original regulations[1] as the “Principal Regulations” and the amending...
Read More
Leasing & Lease Disputes / Property & Development / Real Estate Agents

COVID-19 and the New Changes to Leasing

Additional measures are being introduced in relation to commercial tenancies, including the following: An extension to...
Read More
Leasing & Lease Disputes / Property & Development / Real Estate Agents

COVID-19 Lease Update – The Regulations are in. It’s time to negotiate in good faith

The Covid-19 Omnibus (Emergence Measures) (Commercial Leases and Licences) Regulations 2020 (“the...
Read More